Security Deposit Rules & Tenants' Legal Rights
Generally, a security deposit is a payment applied at the beginning of a tenancy to be used as reimbursement for the landlord. The landlord may need these costs as compensation for a tenant’s failure to pay rent, or to cover rental repairs or damage above ordinary wear and tear caused by the tenant. State laws regulate the amount landlords can charge for a security deposit, as well as deadlines for returning deposits upon the termination of the rental agreement. Local laws may apply as well, especially if your rental property is covered by rent control.
Security deposits apply to both residential and commercial property. For certain issues, such as housing discrimination or rent control ordinances, other laws may supplement state laws concerning security deposits.
Amount of Security Deposit
The rental agreement will set the amount of the security deposit. Some states do not set a limit on the amount a landlord can charge for a security deposit. Other states limit the deposit to an amount equal to one or two months of rent. Variables may include whether the unit is furnished, or whether the tenant has a pet.
Refund Requirements After Tenant Vacates
In most states, the law requires the landlord to refund your deposit after you move out. Within two to three weeks after vacating the premises, the landlord mails a statement with an itemized list of expenses, including cleaning and repair. After the deposit has been applied to these expenses, and applicable deductions are made, the remaining deposit plus any interest earned will be returned to the tenant.
The landlord has a duty to take care of all repairs to the unit. However, tenants are not responsible to pay for damage from normal wear and tear. If the rental unit is excessively filthy or damaged, the security deposit may be applied to restore the unit to its original condition.
One of the best ways to ensure that your landlord returns your deposit is to carefully inspect the unit when you move in. Use a written checklist to inventory the items inside the unit, as well as any defects or damages. Provide detail, and make a copy so that both you and the landlord have the completed checklist. It is best to prepare this checklist while walking through the unit with the landlord.
To prevent disputes or disagreements, discuss or provide notice of any damage that you do find in the unit. Finally, take photos to document the condition and appearance of your unit. Provide a set of these photos for your landlord and, ideally, have your landlord sign the photos to indicate that he received them.
At the end of your lease, or when you decide to move out, return to your checklist and inspect the same items, noting their condition. Take more pictures and show them to your landlord. Since you are protected from paying for repair to items that were damaged when you moved into the unit, your checklist and photos will help you determine appropriate uses for your deposit.
Retaining the Security Deposit at Termination of Tenancy
If the landlord has not returned your deposit, or has made deductions that do not seem appropriate, you have options. First, make sure that you have given appropriate notice of your termination of the lease, paid all the rent on time, returned the keys, and left the unit in good repair. Next, try to work out an agreement with the landlord. If you do come to an agreement, write it down and sign it so that it becomes a binding contract.
The next step is requesting the return of your deposit more formally. A demand letter, including facts supporting your claim that you are owed money, can be drafted and should include a copy of your lease, as well as citations to applicable state security deposit law. Sometimes the demand letter is motivation enough for your landlord, since it demonstrates that you are knowledgeable and aware of your rights.
Finally, if your demand letter and an attempt at negotiation do not help to resolve your claim, it may be appropriate to file a lawsuit against your landlord.
